30-Year Mortgage Rate Falls

(October 31) --   McLean, Va.--In Freddie Mac's Primary Mortgage Market Survey, the national average commitment rate for a 30-year fixed-rate mortgage (FRM) was 5.94 percent, with an average 0.6 point, for the week ending October 31, 2003, down from 6.05 percent last week. Last year at this time, the average commitment rate for a 30-year FRM was 6.13 percent.

The average commitment rate for a 15-year FRM this week is 5.26 percent, with an average 0.6 point, down from last week's average of 5.39 percent. A year ago, the 15-year FRM averaged 5.51 percent.

One-year Treasury-indexed adjustable-rate mortgages (ARMs) averaged 3.74 percent this week, with an average 0.7 point, down slightly from last week's average of 3.76 percent. At this time last year, the one-year ARM averaged 4.25 percent.

"Gross Domestic Product numbers surprised everyone today, posting a much larger-than-expected increase and confirming the notion that the economy has finally turned the corner," said Frank Nothaft, Freddie Mac chief economist. "Worry about disinflation should now be tempered somewhat, but fear of inflation is still unwarranted. And that should keep mortgage rates from rising too quickly or steeply anytime in the near future."

"Third quarter home sales continued to be strong," he added. "As long as mortgage rates remain under about 6.5 percent – last year's annual average – the housing market will remain healthy."

--Freddie Mac

"Copyright National Association of REALTORS®, Reprinted with permission."